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tv   World Business Today  CNN  April 15, 2011 4:00am-5:00am EDT

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>> thank you so much. >> that is all. i'm monita rajpal at cnn london. here's are the headlines. libyan state tv says there were civilian casualties from nato air strikes in tripoli thursday. but the bombs didn't stop moammar gadhafi who rode through the capital city unfazed and displaying his bravado. nato ministers provided a united front in berlin. privately, there's disagreement over how to attack gadhafi's forces. britain and france want more
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firepower and nato's secretary general says precision air strikes are needed to avoid civilian casualties. an italian activist and journalist kidnapped in gaza is apparently dead. this video was posted on youtube hours before police found his body. those are the headlines, i'm monita rajpal in london. "world business today" starts right now. good morning. and a very happy friday to you, i'm nina dos santos in london. >> and i'm pauline chiou in hong kong. welcome to "world business today." here are the top stories today. china's roaring economy races troy the first quarter but beijing struggles to keep a lid on prices. investors are searching for answers as google's overheads balloon. plus, take from the rich to give to the poor. more than 1,000 economists lobby
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for a robinhood tax as g-20 finance ministers gather in washington. but first, inflation, this is an issue that's had policymakers around the world worried for months now. china's leaders are no exception. and the latest data on consumer prices won't be giving them much comfort. figures released today show that inflation hit 5.4% in china in the first quarter of this year. that's its highest level in almost three years. the rise comes despite aggressive action by the central bank to try to tame runaway prices with four interest rate hikes in the past six months. the chinese economy isn't showing many signs of cooling down either with growth of 9.7% in the first quarter. that's down from 9.8% in the previous quarter. but still ahead of analysts' expectations. joining us now to tell us more about what these numbers mean, is eunice yoon, she's live in
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sanya in southern china. the march inflation figure is more than economists expected. will beijing continue what it's doing at a gradual pace or maybe change its strategy? >> reporter: pauline, authorities are likely to be even more vigilant. as you know, the government has made fighting inflation a priority for the year. they want to keep prices in check. however, there are people who are benefitting from the rise in prices. on the outskirts of beijing, workers are tending to tomatoes at this greenhouse. the former electronics manager switched into farming two years ago. and what turned out to be a money-making move. food prices have gone up in the market, she says, which means profits here for us. prices for all sorts of food have been going up, pushing inflation in china to its highest level in two years. the 2011, the government vowed
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to combat rising prices, to keep food affordable for its people an prevent social unrest. prices have definitely gone up, this shopper says. things are more expensive across the board the past year. but while most complain about their ever-increasing grocery bill, others are taking advantage, sparking a trend worldwide, including china. the prices of vegetables in china are rising in the double digits. the high prices are encouraging more people to invest in farming. here in a country where rural incomes have lagged behind, more people are looking to work the land. the government is offering financial incentives, helping wong open ten greenhouses throughout the year. we are making more now, she says, with government subsidies i have done better than in my previous line of work. inflation raised the cost of farming. the higher price of fuel, labor and other materials has been eating into farmers' profits.
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>> if you look at the data, actually there has been bad weather and because there is a production decline. that's why. and there's also been problems in transport. transport costs have increased. there's not a clear winner. >> reporter: yet with so many greenhouses, wong feels like an unexpected winner this global food crisis. that said, pauline, the vast majority of the people here would rather that prices didn't rise so fast. >> right. especially with food inflation at about 11% right now. eunice yoon reporting live from sanya in southern china. thanks so much, eunice for that take. let's take a look at the markets in china and other parts of the asia-pacific region. asian stocks rallied early in the day on news that the chinese economy is still growing strongly but then, the inflation numbers from china spoiled that mood, rapidly rising prices in
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china increased the likelihood of monetary policy tightening in the world's second biggest economy as eunice had just said. overall, the mood wasn't terribly upbeat today. you see the nikkei down 0.6%, the hang seng down just a fraction there and news that tricks giant sony is considering a temporary production shutdown won't have helped the index in japan either. sony says it's thinking of stopping its assembly lines for two weeks at some of its factories in japan to conserve power. the japanese government is asking manufacturers to cut their electricity consumption because ever the earthquake and the tsunami which damaged power stations. nina? >> thanks very much, pauline. here in europe, the markets have been open for just over an hour's time. let's take a look the how some of the things are faring. with the optimism in the united states, helping some of these markets. the ftse 100, which is just
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slightly up is teetering towards the flat line. we've also got the cac 40 in paris, that market down by about 0.3%. one thing i want to mention is the fact that moody's, the credit ratings agency cut its rate big two notches for ireland now. not the first time we've seen this done in the last month or so. it's almost imposed an outlo outlook -- sorry. also imposed an outlook negative on it which means it could potentially further downgrade ireland's credit rating. and this is coming after, of course, the finances have worsened for that particular country. let's move things along and talk about some other news in britain in the financial services sector. lloyds banking group is yet again cutting a further 325 jobs. the positions are to go mainly in the staff business support roles, particularly along the
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united kingdom, though its banking group has slashed 22,000 jobs since it was created by the takeover during the height of the financial crisis. lloyds is 21% owned by the government. the latest round of cuts has been described as staggering. the u.s. markets look set for a lower open. this is how the premarket futures stands. it's a mixed picture. the nasdaq showing gains at the moment in terms of the futures markets. on friday, investors will be turning their attention to bank of america first quarter results. keep an eye out for that in our second edition of "world business today" later on. pauline? nina, we're keeping our eye out on google futures. they're down about 5.5% in premarket trade. that's because the search giant missed expectations on thursday when it announced its first quarter earnings. but make no mistake, because google is still making tons of
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money, net income in the first quarter of this year was $2.3 billion, which is up 17% from last year. and sales rose 27% to $8.6 billion. now, let's take a look at how google stock has done in the past 12 months or so. you see that there's a dip early on in july of last year. actually in the middle of the year. that's because profits missed q2 expectations because of acquisition costs and legal costs from regulators. then you see the stock price spike right here. that was in october of 2010. that's when the stock jumped to nearly 9% because q3 earnings beat expectations. then you see an even higher peak over here, january of this year. that's when googal nounsed stellar fourth quarter earnings. it was also the same month that eric schmidt, the ceo then said he was stepping aside and you
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might remember his famous tweet where he said adult supervision no longer needed. larry page took over last week in this part of the time line. some investors are worried that google may have plateaued and that it still needs to innovate a lot more and mack a mark in social networking in that sector, of course, google's biggest competitor is facebook. industry insiders say google's new ceo, larry page, has his wo work cut out for him. >> the test really is whether he's going to not only do the strategic product oriented stuff that we know he's going to do. we know he's a smart guy. whether he's also going to take on the other side of the ceo. if google's public perception is as much a product and as important a product for google as it goes forward and negotiates regulatory problems, privacy criticisms and things like that. so larry has to step up, not
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only in terms of coming up with great products and vision and taking on facebook but he has to be able to make people feel okay about google, not be scared of it. >> and page does have ambitious growth plans. in just the few days he's been in command he started the company's biggest hiring spree which is bumping up overhead costs. he also reshuffled management to give top executives direct oversight of google's products. nina? coming up next, we'll have more on the bill to keep the u.s. government running, which is now on its way to president barack obama's in tray. we'll be right back.
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oil prices are slipping this friday. light sweet crude is down but just slightly trading right now at about $107.77 a barrel.
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that the down by about 0.3%. analysts say a combination of the weak u.s. dollar and also high u.s. demand is helping to support prices being on a sharply upward trajectory. welcome back to "world business today" on cnn. when it comes to budget battles in washington, to borrow a phrase from an old rock song "you ain't seen nothing yet." as dan that bash reports from washington, the coming battles over next year's budget will make this one look, well, like chump change. >> reporter: the bill keeping the government running for the rest of the year passed the house but with significant gop defections. 59 republicans voted no. gop congressman like freshman bill said it spent too much time
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on spending cuts. >> i hate to go back to my constituents sean a this is the best we can do. >> reporter: it was questions about the real impact of the cuts. a new report from the congressional budget office said while the measure does cut $38 billion in spending, only a fraction of those savings will be realized this year. $352 million. that has to do with arcain budget differences between what's known as budget outlays versus budget authority, how much agencies are allowed to spend. the politics of that smaller number caused deep concern among rank and file republicans. gop leaders scrambled to reassure them with emergency briefings and meetings. >> certainly it has caused some confusion. let's understand that we're cutting $38.5 billion of money. >> reporter: still republicans like this say the $352 million figure did have an impact on gop votes.
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>> as you go back into it and dive into it, it's what accounts they're coming out of. >> reporter: but? >> i think it sends the wrong message to people. it's explainable. you can't do it in two sentences. >> reporter: in the face of that kind of concern from some of his rank and file, the house speaker laid out his bottom line. >> i'll tell you that this is the best we could get out of the divided government. >> reporter: but a quarter of all house republicans said the deal wasn't good enough and voted no. without significant support from democrats, this spending measure to fun fund the government for the rest of year would not have passed the house. the senate later overwhelmingly passed the bill, sending it to the president's desk and ending a fight over millions in last year's budget. dana bash, cnn, capitol hill. former u.s. presidential candidate steve forbes whose chairman and editor in chief of
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forbes media is bullish on that coming budget battle. he doesn't think much of current u.s. economic policy. he compares the economy to a car engine. too little fuel, that is money, and then the car stalls. too much fuel it floods. forbes told cnn the fed's policy of quantitative easing or pumping hundreds of billions of dollars into the economy is hurting recovery. >> the fed has done the equivalent of flooding the engine. it's had huge distortions which are why commodity prices have soared, food prices and the like. we see it at at fuel pumps as well. that will be extremely damage together president. i don't think he realizes how vulnerable he is. every time the dollar is trash, a u.s. president is severely harmed. it harmed george w. bush, jimmy carter, it harmed richard nixon. i think the white house will be blindsided by this. a cheap dollar means a weak recovery. that won't be good news for him
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or the american people in 201. >> forbes also told us a return to the gold standard would stabilize currency prices. nina? >> plenty ever debate about the gold standard. finance ministers will be attending a meeting in washington on friday. hundreds of economists from dozens of countries are calling on them to institute a so-called robinhood tax on financial transactions to fund solutions to some of the world's most critical problems. emily rubin joins us now in our london studio with the details. how would this proposed robinhood tax work? >> it's called a robinhood tax because it emulates the famous folk hero that stole from the rich and gave to the poor. the money raised from that which could run into billions of dollars would go on several things, international development, climate initiatives and those who bailed out the
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financial sector. there were some 300 economists supporting it. today there are 1,000. they've opened a written letter to the g-20 finance ministers. they say the financial crisis has shown us the dangers of unregulated finance, it's time for the financial sector to give something back to society. this tax could raise hundreds of billions of dollars and calm speculation. i've just been doing a bit of research. the center for economic policy at the mass maachusetts univers has done some sums on what they could raise. they say they could raise $358 billion a year. it could bring in $176.9 billion, even if it was halved. >> this is a question of economics, isn't it? will these proposals work? >> the bankers say no. more on that in a minute but there is political momentum growing. that's the key thing here.
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they said this should be introduced europe-wide. the european commission has a consultation period on this at the moment. there are hollywood stars getting involved. let's take a look at this video promotion from ben kingsley, the oscar-winning actor. >> don't hurt me. >> as i said, the european commission are looking into this and it's also being reported that bill and melinda gates foundation is trying to build a global consensus, too. >> that's heavy lobbying from those high-profile characters. let's move along to what the banks think of this. we see all sorts of political tinkering when it comes to regulating the banks, putting money aside for future crises. what do they make of it? >> the banks are already facing in the uk a $3 billion levee. they say this tax on transactions might be slightly fairer in that it would tax trading volume.
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hedge fund speculators would share the burden. they also are concerned about the practicalities of implementing this. they say this idea has been around before but nobody has come up with a coherent play on how to implement it. >> the debate continues. thanks very much for that. pauline? >> for all of us flyers out there, this is frightening. asleep at the switch. too many u.s. air traffic controllers nodding off on the job has cost the department's supervisor his job. we'll have details, next.
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gold is still glittering pretty brightly on this friday. right now it's trading up 20 cents at 1,474. on thursday it hit another record high, particularly in
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chi china. a weak u.s. dollar also contributed to the rally. this is "world business today." the federal official in charge of air traffic controllers is resigning after yet reports of another controller falling asleep on duty. the latest incident came on wednesday morning at the reno tahoe international airport in nevada. a medical flight carrying a patient was trying to lands. transportation secretary ray lahood calls the trend absolutely unacceptable. aviation officials have assigned an extra controller to the midnight shift in 27 control towers where there was only one single controller at the time. let's get a check for all you business travelers on your weather forecast. jennifer delgado is tracking some of the severe storms across the united states. >> we are tracking severe weather but i want to point out
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to you right now, we don't have delays at any of the arptz. as we go later into the morning and afternoon, we are picking up delays due to rain outside and some strong storms. right now we have a tornado watch in effect. that's going to go through, i would say, for the next five hours through parts of louisiana as well as parts of arkansas. you can see the line right here, snow up towards the north and parts of the dakotas. that storm system will be moving over towards the east. it will be producing winds. we're talking about 70 miles per hour, up to 111 kilometers. it's going to prout possibility of more tornadoes. we've had ten of them reported on thursday and we're also talking about large hail. and that system moves over toward the east. we'll deal with this as we go through saturday with the potential for the severe storms to pop up across the southeast and eventually moving off towards the northeast. now, things are a lot quieter across china. we have weak boundary system producing clouds around. overall it's nice and quiet.
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let's go to video coming out of hong kong. let's look at the harbor. a beautiful day indeed. pauline is probably itching to get out of the chair so she can enjoy. it will be dry for the upcoming weekend. the temperatures, i take you back over, it's warm right now in hong kong, 28 degrees, the same in taipei, manila, you're warming up now that we've had the northeast monsoon come to an end, we have a reading of 32 degrees. beijing, temperatures will run about 10 degrees above average as we go through sunday and we'll eventually see a cooldown. more "world business today" coming up in just a moment. don't go anywhere. stay with us.
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hello and welcome back to "world business today." china is reporting food prices there have been rising 11% in the past year. but that trend although worrying to chinese officials is actually pretty tame if you compare it to what's going on in the rest of the world. the world bank is warning that rising food prices driven partly by sharply higher fuel costs are pushing millions of people into extreme poverty. the bank says that world food prices are up no less than 36% so far this year. that hits the poor people the hardest, since these are those who spend so much more of their income on food to begin with. the bank estimates that higher prices have pushed some 44 million people into poverty since last june. the bank also estimates that about 1.2 billion people are
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living on less than $1 a day. the food prices are affecting everybody but the poor people the hardest. >> we can see that. we've heard so many stories but nina, let's show you how food prices have risen in the last year. we're going to take a look at some of the commodities from everything from maze to wheat, palm oil, soybeans and beef. keep in mined that animal feed made oust corn creates the demand and the higher prices for maize. wheat is next. the prices for wheat up by 69%. we go down the line with beef prices going up about 30%. but interestingly enough, nina, the price of rice has actually fallen by about 2%, which should ease a little bit some of the concerns here in asia, because rice is such a staple here. still as you mentioned earlier, food inflation in china still in the double digits. pauline, those rising food
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prices and prices of other basic goods as we are just saying hit people in the pocket, especially those people who are poorest and have less in their pockets. people with low income spend a greater position of their money on these items. but joseph stiglitz, a nobel economics laureate says it's the middle class and, therefore, society as a whole that's in trouble. >> one of the things i've been very concerned about is the shrinking middle class in the united states and some of the other advanced industrial countries. median income for instance in the united states today is lower than it was 12 years ago. median income are the people right in the mightle. we have a shrinking middle class, they have an expanding middle class. it's the middle class that makes any society vibrant, that
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creates, from which you get the new entrepreneurs, that creates the source of stability both for the economy and for politics and for society more broadly. so i'm very optimistic, again, about the brics because they are helping create a vibrant middle class. >> joseph stiglitz is a former chief economist at the world bank. let's see what's going on in the european markets. we're about 90 minutes into today's trading session. it's been a mixed picture if you look at this. the cac 40 down by 0.3%, and the dax up by 0.1%. moody's has downgraded ireland's credit rating by two notches. also slapped on a negative outlook, some traders and investors taking that as a cue that the ratings agency may consider further cuts to the
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credit rating going forward, all of this coming after we had news of the stress tests for the irish banks a couple weeks ago, showing they needed tens of billions of euros in terms of that to keep themselves on the go. obviously the financial secretarier in ireland very much at the heart of the downgrades we've seen from the likes of moody's and other credit rating services, pauline? >> let's take a look now, nina, at the markets in the asia-pac region and how investors reacted to the inflation and gdp numbers that came out this morning from china. asian stocks rallied early in the day on the news that the chinese economy is growing strongly at 9.7%. but it didn't take long for that high 5.4% inflation rate to spoil the mood. rapidly rising prices in china increased the likelihood of monetary policy tightening in the world's second biggest economy. overall the mood was somewhat downbeat with the key indices
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down, except ironically for shanghai's, which is up b more than 0.25%. nina? >> seems as they there's no resounding theme in the markets there, pauline. let's move things along and talk about the tech knowledge sector. the name blackberry has long been associating with mobile computing. its maker, research in motion plans to bring blackberry's innovation to a tablet. it goes on sale next week in the u.s. it features video capabilities but crucially no e-mail function. still, rim's ceo predicts the portability and functional will win over consumers. >> we have the super high-performance, full web experience, no changes, that's a core issue. second is the portability. it can go into a coat or a
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purse. it's easy to carry and use. for businesses it securely pairs with your blackberry. the blackberry enterprise server for enterprise connectivity. >> but some reviews are not quite so enthusiastic about the playbook and how it will fare against its competitors, for instance, such as ipads and android tabbettes. . let's give you a flavor of what the critics think about the playbook. david polk writes that rim has just shipped a blackberry product that cannot do e-mail. it must be skating season in hell. "the wall street journal's" tech oracle calls it a companion to a blackberry adding that may be fine for dedicated blackberry owners but it's not quite so great for people with other types of phones. others have been having trouble turning the gadget on, writing
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about the power button, engadget said it's possible to find and feel and once located it's difficult to activate. pretty scathing reviews there, pauline. >> yes. that's a problem if you can't find the power button. nina, it may be a bit too soon to write off the paperback book but for the first time, ebooks have passed those of paperbacks. e book sales hit $90.3 million. adult paperback lag behind at 81.2 million. sales of e-readers and tablet computers have surged and consumers want to use them. nina, i'm fascinated whenever i see someone in the airport with a kindle or sony e-reader. i'm tempted to get one. but i have way too many gadgets. i have a blackberry, iphone, my
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macbook laptop. i cannot carry a fourth gadget with me when i'm traveling. >> i have the opposite problem, too many books. i keep lobbying my husband for one of those kindles. that way we can get rid of everything in the library. the 15th annual wehbe awards will be handed out on june 13th. there are loads of categories for rewards. we're going to look at one in particular that's been getting quite a bit after tension of late, viral marketing got a big shot in the arm. that's because of an underarm deodorant. take a look. >> on youtube, 12755jdh commented, i love these commercials and i love you. >> this is one of the best internet marketing campaigns we've ever seen. >> you tell me. >> from a sheer amount of numbers and traffic that it generated and how many people
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paid attention to it to just the overall quality and how quiting and fun it was to watch be unveiled, really. at the end of the day, a music video is still a band's best marketing tool. ok go pioneer, the idea of sharing music videos online. this is one of the most elaborate goldberg machine that's ever been created and shot. two very popular tv shows in the u.s. that have great marketing campaigns behind them are being honored. one is mad men and specifically the execution mad men youself and the other one is the true blood live feed execution. a lot of these television shows are looking at how people can participate in the show, after the show is over, before the show happens, while it's going
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on even. both of these campaigns really speak to that. google translate for animals is another nominee on the viral marketing list. >> here it transcribes it but if i push the speaker button we can actually hear what bella said. >> me person, smells good. >> that's amazing. >> the concept here what if your android phone there was an app that could translate what your dog was saying. >> who needs telepathy when you can use that google software to translate it. interesting stuff, isn't it? voting aopen until april 28th. you can vote at webbyawards.com. let us know what you'd like. access our page by going to facebook.com/cnnwbt. pauline, what do you think?
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are you going to be trying that software on one of your animals? do you have any pets? >> i don't have any more pets. i used to have dogs but sadly they all passed away into another world. i don't know if i really believe that. i mean, is it for real? or is it a joke, the google translator? >> i quite like the look of the diet coke man at the beginning, though, right? >> yeah, yeah. they're all quite good. they're all quite good. >> it's not all about business news. anyway, that's it for this edition of "world business today." i'm nina dos santos in london. >> and i'm pauline chiou at cnn hong kong. marketplace middle east is come up next.
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this week on "marketplace middle east," leaders gather in doha to discuss the way forward for libya as gulf states play a bigger role and qatar raise the stakes. and ties that bind, cairn they foster trade and stability in the mediterranean? united in their plan to colonel gadhafi must go, foreign
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ministers of 21 nations have made new proposals to support libyan rebels. the group met in qatar. the opposition now is expecting a flood of unfrozen cash, much of it would be used to pay for weapons. that's an area among disagreement among the international coalition. arming the rebels is supported by qatar. >> qatar, part of the international community and part of this coalition and, of course, we will look at it and make things available for the libyan people to defend themselves. >> as the host of the contact group meeting, qatar is raising its profile on the world stage. saudi arabia has long dominated proceedings in the gulf but now off the back of rich natural gas exports, the small state of qatar is carving out a bigger role in the region and beyond.
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we have that story. >> reporter: it's a tiny gulf state with just over a million people but qatar is positioning itself on the international stage. >> qatar is certainly trying to carve out a niche. it's been doing so for some time. we saw an effort to the lebanese factions and we've seen that continue in yemen and darfur. >> reporter: most recently in libya. qatar was the first arab country to contribute planes to police a u.n.-backed no-fly zone. it was also the first to recognize libya's rebel council has legitimate representatives of the libyan people. it even agreed to export oil from libya's rebel-held territory. much of qatar's power stems from its enormous wealth. due to an overhaul of its oil and gas sector, qatar is now the world's largest exporter of liquefied natural gas. that's made it one of the richest countries in the world. despite the global financial
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downturn, qatar's economy roared ahead at a rate of 16% last year. here in the gulf, qatar's economic strength is allowing it to flex its political muscle. it's moving aguessively, especially in the case of libya. that's giving it a high profile but there's also a high risk if libya remains unstable. for now, analysts say qatar is playing up its strategic location. >> qatar is very strategic but in the following sense, because it likes to play all sides. in fact, even though it houses a u.s. military base, last year qatar signed two agreements with iran. now in 2011, the situation is changed. qatar has not publicly said what its position is regarding iran. nevertheless, qatar sees itself as a strategic asset within the region. >> reporter: qatar has so far
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escaped the turmoil that spread across the middle east. at a time when dem strarts elsewhere in the region are demanding their voices are heard, the question remains if one of the region's most powerful monarchies can lied the way. >> the star is rising. it's the base for al jazeera, what is siessentially getting o the story in the middle east. i think most 69 arab world are thankful for that. >> reporter: qatar will have to tread carefully and not step on the toes of the region's other power places. "marketplace middle east," abu dhabi. it's back to the drawing board for the european union. mediterranean countries are trying to reignite strong historical times as north african states face upheaval. after a strategy to stall, it could prove to be too little too late.
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nicolas sarkozy had a grand plan in mind. the union of the mediterranean to be a hallmark of his rotating eu presidency in 2008. the math was simple. the scale grand. up to 44 nations of europe, the middle east and north africa, that among other things would foster trade with the mediterranean sea as its center of gravity. the french president wanted to expand the original plan launched in the mid-1990s. the policy structure was in place but the actual building of this economic blueprint never really got off the ground. >> trade is 10% of european trade. that's a paltry number. >> stretching from morocco in the west and lebanon in the east, this could be a market of
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775 million consumers. putting business down the priority list led leaders like silvio berlusconi to try to secure its own deals. >> reporter: the upridesings have been a game changer. now everyone is look together european union to come up with a strategy to stabilize north africa. to create a trade zone for the mediterranean. european central bank chief jean-claude trichet said it's important that the southern players don't run the process. >> all the countries are in, even those are w.h.o. are not miditalian countries. that's important. >> reporter: while europe is currently hand strung by debt problems and bailouts,
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investments from the oil-rich gulf states and to north africa have created an arab regional market led by the private sector. strategists like florence eade calls this a new paradigm. >> the trouble with the first iteration of this regional cooperation attempt was that it was led by the europeans and the north africans were most likely the counterparty to this. >> reporter: the key now is putting the politics of who leads aside to inject funds into a region which needs to rebuild and, most importantly, create jobs. >> up next, more on euro med. location, location, location. greek finance minister on why leveraging trade relationships already in place is the key to prosperity for europe and north africa.
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with mounting debt and a downgraded credit rating, greece is struggling to emerge from recession. the country wants to leverage its geographical position at the heart of the mediterranean to serve as a gateway between europe and the middle east. i caught up with the greek finance minister and asked him how greece would benefit from this unique partnership. >> we have particularly well positioned to take advantage of this and be able to drive it forward. we've had traditionally very good relationships with the arab world and we can be an important player in this. there's an increasing interest for investment, not only in property but infrastructure and particular sectors of the greek economy, coming from the region. greek construction companies have been very active in the gulf. given there's a strong economic base, we can also help this
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political process. >> many thought about this in marshall plan concept which sounds very good on paper but in practice can it be implemented? does europe have that will to do so? >> i think europe is committed to the broader region. it's clear that some mediterranean european countries, of course, have much more of a willingness to go and invest strategically in the region, politically, economically, let's not forget. one of the first problems europe has is the immigration that comes through it. and we have in greece have had serious problems of this counted. >> this is greece, italy, malta, in particular, spain. >> we are the first outpost for this synchronization. it's in all our interest to help the region develop, help democratic movements take root, stabilize the situation and help them go forward. >> unemployment of 14% but even the same traits in north africa, it's double amongest the youth in greece. this is going to create huge
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pressure for this government. >> youth and employment is a very important problem. any level of unemployment is high. youth in employment is erosive, corrosive for the fabric of society because it kills the instincts and the opportunity and the desire to do something with your life. there's underlying structural problems we're trying to address, problems about the educational systems and to correspond to the needs of the market and the economy. >> there's a huge concern of where the growth is going to come from. a contraction of 3% this year and then into a positive territory for 2012, that's the scenario? >> we think we bottomed out in the recession. actually if you look at the data, it's getting shallower. we're getting into improving territory with a positive quarter, perhaps the third or the fourth of 2011. >> as early as the third. >> more likely the fourth. what's driving this, this is the interesting part of where growth will be coming from, to a large
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extent exports. our exports in the last four months have been booming, growing at a rate of 25% to 40%. >> bookings in turkey and in greece are going through the roof for the summer months. >> we see some very good early indications of bookings. and by now, not only early but solid indication. but more broadly, i think that if you go away from the tourism issue, the relationship in the region is something we're very keen to develop further. and there may be trouble now. but trade investment, going and coming from greece and the entire middle east area continues to be very strong. >> that's it for this edition of cnn "marketplace middle east." i'm john defterios. thanks for watching. we'll see you next week.
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